European stocks resumed their losses this week as interest-rate cuts failed to ease concern the economy and corporate earnings will deteriorate.
The Dow Jones STOXX 600 Index dropped 1.1 percent in the five days, following the steepest weekly gain since 2001 a week earlier.
ArcelorMittal sank 13 percent after the world’s biggest steelmaker cut production and Lafarge SA slid 9.4 percent as the largest cement producer abandoned its 2010 earnings target. Money managers Man Group PLC and 3i Group PLC dropped more than 10 percent after the value of their assets declined.
Europe’s STOXX 600 retreated 2.47 to 219.6, taking this year’s loss to 40 percent as almost US$700 billion in credit losses dragged down economic growth. Profit concern this week also overshadowed speculation that US President-elect Barack Obama may boost growth with a stimulus package.
Policymakers in the euro zone, the UK, Switzerland and Denmark lowered rates to ease the effects of the global credit squeeze. The Bank of England unexpectedly cut its benchmark lending rate by 1.5 percentage points to the lowest since 1955. The European Central Bank reduced borrowing costs by 50 basis points to 3.25 percent.
Analysts have scaled back their estimates for this year’s profits at STOXX 600 companies to a 6.8 percent drop, from an 11-percent increase forecast at the start of the year, Bloomberg data show.
The European Commission said on Monday the region’s economy probably entered a recession in the third quarter and trimmed its growth forecast for this year to 1.2 percent from 1.3 percent.
The STOXX 600 declined 13 percent last month, its worst monthly performance since September 2002, even after climbing 12 percent in the previous week.
National benchmark indexes fell in seven of 18 western European markets.
Germany’s DAX Index dropped 1 percent. France’s CAC 40 slipped 0.5 percent, while the UK’s FTSE 100 advanced 0.3 percent.
The Chien Feng IV (勁蜂, Mighty Hornet) loitering munition is on track to enter flight tests next month in connection with potential adoption by Taiwanese and US armed forces, a government source said yesterday. The kamikaze drone, which boasts a range of 1,000km, debuted at the Taipei Aerospace and Defense Technology Exhibition in September, the official said on condition of anonymity. The Chungshan Institute of Science and Technology and US-based Kratos Defense jointly developed the platform by leveraging the engine and airframe of the latter’s MQM-178 Firejet target drone, they said. The uncrewed aerial vehicle is designed to utilize an artificial intelligence computer
The Chinese Nationalist Party (KMT) caucus yesterday decided to shelve proposed legislation that would give elected officials full control over their stipends, saying it would wait for a consensus to be reached before acting. KMT Legislator Chen Yu-jen (陳玉珍) last week proposed amendments to the Organic Act of the Legislative Yuan (立法院組織法) and the Regulations on Allowances for Elected Representatives and Subsidies for Village Chiefs (地方民意代表費用支給及村里長事務補助費補助條例), which would give legislators and councilors the freedom to use their allowances without providing invoices for reimbursement. The proposal immediately drew criticism, amid reports that several legislators face possible charges of embezzling fees intended to pay
REQUIREMENTS: The US defense secretary must submit a Taiwan security assistance road map and an appraisal of Washington’s ability to respond to Indo-Pacific conflict The US Congress has released a new draft of the National Defense Authorization Act (NDAA), which includes up to US$1 billion in funding for Taiwan-related security cooperation next year. The version published on Sunday by US House of Representatives Speaker Mike Johnson removed earlier language that would have invited Taiwan to participate in the US-led Rim of the Pacific Exercise (RIMPAC). A statement on Johnson’s Web page said the NDAA “enhances U.S. defense initiatives in the Indo-Pacific to bolster Taiwan’s defense and support Indo-Pacific allies.” The bill would require the US secretary of defense to “enable fielding of uncrewed and anti-uncrewed systems capabilities”
Renewed border fighting between Thailand and Cambodia showed no signs of abating yesterday, leaving hundreds of thousands of displaced people in both countries living in strained conditions as more flooded into temporary shelters. Reporters on the Thai side of the border heard sounds of outgoing, indirect fire yesterday. About 400,000 people have been evacuated from affected areas in Thailand and about 700 schools closed while fighting was ongoing in four border provinces, said Thai Rear Admiral Surasant Kongsiri, a spokesman for the military. Cambodia evacuated more than 127,000 villagers and closed hundreds of schools, the Thai Ministry of Defense said. Thailand’s military announced that
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